139Loans to pay scheme benefitsE+W+S
(1)Subsection (2) applies where section 138(2) applies in relation to an eligible scheme.
(2)Where the Board is satisfied that the trustees or managers of the scheme are not able to pay benefits under the scheme rules (reduced in accordance with section 138(2)) as they fall due, it may, on an application by the trustees or managers, lend to them such amounts as the Board considers appropriate for the purpose of enabling them to pay those benefits.
(3)Where an amount lent to the trustees or managers of a scheme under subsection (2) is outstanding at—
(a)the time the Board ceases to be involved with the scheme, or
(b)if earlier—
(i)the time during the assessment period when an order is made under section 11(3A) of the Pensions Act 1995 (c. 26) directing the winding up of the scheme, or
(ii)where no such order is made during that period, the time when the assessment period ends because the conditions in section 154(2) or (5) are satisfied,
that amount, together with the appropriate interest on it, falls to be repaid by the trustees or managers of the scheme to the Board at that time.
(4)No loan may be made under subsection (2) after the time mentioned in subsection (3)(b)(i).
(5)In subsection (2) the reference to “benefits” does not include money purchase benefits.
(6)In subsection (3) “the appropriate interest” on an amount lent under subsection (2) means interest at the prescribed rate from the time the amount was so lent until repayment.
(7)Subject to this section, the Board may make a loan under subsection (2) on such terms as it thinks fit.
Modifications etc. (not altering text)
C1Pt. 2 modified (8.3.2005 for specified purposes, 6.4.2005 in so far as not already in force) by The Pension Protection Fund (Partially Guaranteed Schemes) (Modification) Regulations 2005 (S.I. 2005/277), regs. 1(1), 2-11
C2Pt. 2 modified in part (9.3.2005 for specified purposes, 1.4.2005 for specified purposes, 6.4.2005 in so far as not already in force (except ch. 4)) by The Pension Protection Fund (Multi-employer Schemes) (Modification) Regulations 2005 (S.I. 2005/441), regs. 1, 2-60, 71, 72
Commencement Information
I1S. 139(1)-(5)(7) in force at 6.4.2005 by S.I. 2005/275, art. 2(7), Sch. Pt. 7
I2S. 139(6) in force for the purpose only of conferring power to make regulations, orders or rules, as the case may be, 10.2.2005; and for all other purposes at 6.4.2005 in so far as not already in force by S.I. 2005/275, art. 2(3), Sch. Pt. 3